In The Sales Process Blog we have previously written about the background to why sales targets look like they do. We have also connected the strategic sales objectives to operational sales activities; what should be done daily, weekly, or monthly by each individual sales rep using the Sales Scenario Tool:
We have been discussing the background to why the operational sales targets says, for example ten customer visits a week and not eight or twelve.
Strategic goals are usually several-year horizon, usually three years. Based on these, you can then break down targets on an annual basis and then connect what outcome you can adopt a year and per sales rep, which becomes the basis of a compensation plan or salary policy. The method creates a driving force on sales rep level to achieve their individual goals, partly thanks to the strong wallet connection.
It’s easy. Set strategic objectives, link them to an operational compensation plan and both management and sales reps are happy because goals will be met.
Now. We all know that reality does not look that way. Things will happen over time. There is a saying that says “if things can go wrong, they tend to do exactly that.”
Let’s look at an example. In the beginning of May you may note that your sales targets are not reached this week. Your sales force conducted an average of only eight customer visits per rep instead of budgeted ten. That means they have to make twelve visits next week to catch up. The problem is that they only performed seven previous week, seven the week before last week and seven visits the week before that. That means you the past four weeks have lost eleven visits in total.
To catch up with your budget and secure your wallet will not be drained, you must then book eleven (your slip) plus ten new visit next week, a total of twenty-one (21) visits.
It is probably impossible; it’s more than the double of the budgeted.
So, what can you do when you find yourself missing the sales targets?
Sometimes it may help using the whip and just run faster – just be sure that there isn’t a ditch ahead, or a precipice or rock wall.
But we at Sales Scenario are sure there will be smarter ways than only run faster, even if that is a component in the discussion. We also believe you need a way or method that prevents the error from occurring – a kind of “correction system” that responds to deviations and provide help at hand for what to do when various events occur – at the tactical level.
You may describe the tactical level like managing events that you did not see or could not take any account of when you described our sales strategy or set your strategic goals.
Such events may be, for example, a news report that suddenly made people reluctant to products in your portfolio. Or raised interest rate for investments or the announcement of a major shutdown of an industry in your town that made people not inclined to spend money. Or…It’s like I said; things will really happen that have an impact on your sales life – positively or negatively
In coming posts we would like to present various examples of events on tactical level that may occur, what actions would be best practice to take into consideration and, finally, what tools may be used for help. In other words, how a sales tactics correction system could be managed.